Senator to FTC: Look into Fake ‘Made in USA’ Labeling

Dive Brief:

Sen. Chris Murphy (D-CT) has asked the Federal Trade Commission to look into whether retailers are mislabeling products as made in the U.S. when they’re actually made overseas.

There is some leeway in such labeling, but Murphy has told the FTC that some companies appear to be taking things too far. A product can be labeled “Made in USA” only if “all or virtually all” of its components, processing, and labor are from the U.S.

Murphy is responding to investigative work by the nonprofit Truth in Advertising, which earlier this month filed a complaint with the FTC after Wal-Mart Stores Inc. failed to follow through on promises to correct its “Made in USA” labeling errors.

Dive Insight:

Wal-Mart Stores itself has acknowledged its problems with false labeling in response to Truth in Advertising’s initial complaints that more than 100 false and deceptive “Made in the USA” claims could be found on its website.

But it’s done little about it. The retailer has tried to minimize the problem, saying the notations were made in error and would be corrected. But Sen. Murphy has taken up the cause, and Wal-Mart may have to step more lively on the matter.

“Made in USA” labels appeal to many American consumers, to the point where a great many are willing to pay more for something made here. The label still connotes a sense of better quality, too (though that may not always be true). Still, a fraudulent “Made in USA” label not only rips off those consumers paying more for what they think are American-made goods, but also the retailers and manufacturers attaching those labels in good faith.

“This standard applies to both manufacturers and retailers, who may include additional product origin labels after manufacturing is complete,” Sen. Murphy said in his letter. “I have particular concern over fraudulent labels that are placed on products by retailers on outer packaging or in advertising for products.”